New Approaches to Reimbursement for Gene Therapy: What Can We Learn from Models Currently in Practice?

BIOtech Now
Theresa Brady

It’s obvious that cost presents a major burden for patient access to gene therapy. The recent approval of Novartis’ gene therapy Zolgensma, which treats children under two with spinal muscular atrophy (SMA), was quickly overshadowed by criticism about the drug’s $2.125 million price tag. As the second treatment approved for SMA, following Biogen’s Spinraza, there’s speculation that competition in the marketplace could lead to lower prices down the line. Nevertheless, pricing hurdles are a hot topic of conversation when in gene therapy.

In the session, New Approaches to Reimbursement for Gene Therapy: What Can We Learn from Models Currently in Practice?, panelists explained that given the recent approvals of gene therapies and more on the horizon, payment and delivery systems are evolving to ensure timely patient access to treatments. The panelists delved into how health systems are looking to novel models that offer creative solutions to reinsurance, pooling of patients, performance-based contracting and high-cost chronic or rare disease payment funds.

Ron Philip, chief commercial officer for Spark Therapeutics, shared three novel payment and distribution options to support patient access to Luxturna, which was approved by the FDA in 2017 to treat children and adult patients with an inherited form of vision loss that may result in blindness. Luxturna is the first directly administered gene therapy approved in the U.S. that targets a disease caused by mutations in a specific gene.

Spark Therapeutics provided an innovative contract model, which provided direct sale to the payer or specialty pharmacy as an alternative to the traditional “buy and bill” model. This reduced the financial burden and risk to the institution. It also reduced mark-up to the payer. The company also offered an outcomes-based rebate arrangement, with a short-term efficacy measure of 30 to 90 days and a longer term efficacy measure of 30 months. Spark Therapeutics also underwent ongoing discussions with the Centers of Medicare & Medicaid Services (CMS) to allow the company to directly offer government and commercial payers the option to make payment in installments, while providing flexibility for greater outcomes-based rebates.

By 2018, 85 percent of commercial lives were covered by acceptable medical policy, according to Philip. The results were even better for 2019.

Another panelist, Ambrose Carrejo, national pharmaceutical contracting leader for Former Kaiser Permanente, emphasized today’s challenging economic climate, in which the average family of four is paying over $2,000 for health care insurance per month. “There is hope that innovation brings an economic offset,” he said. “The new gene therapies show durability and manufacturers are willing and have been willing to discuss various access models, including the acceptance of payment only as mutually defined milestones are achieved over a multi-year process.” He explained that if these milestones are not achieved, a reduced payment or no payment is made.

“We all need payment that is affordable and provides an appropriate return on investment,” Carrejo added.

Allen King, team lead for rare disease patient health and impact at Pfizer, said that with a shift to outcomes-based agreements comes a greater need to collect data. This comes down to a preference choice, with the decision whether to capture data as a manufacturer or at treatment centers. For Luxturna, Spark Therapeutics translated a phase III protocol into an analog that was used more commonly in treatment centers.

The bottom line is that creative models to increase patient access are welcomed—and even embraced—when it comes to paving a future for gene therapy. “We have to figure out a way to pay for it,” Carrejo said, matter-of-factly. “No one wants to see this innovation sit on the shelves.”

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